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tv   The Kudlow Report  CNBC  January 3, 2013 7:00pm-8:00pm EST

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i always say pay attention to the interviews. cheniere, what a story. if it comes in, you buy. hormel, i don't expect it to come in. that stock is very inexpensive. that's a transformative acquisition with skippy. i'm jim cramer and i will see you tomorrow! honorable john a. therefore, the honorable john a.. boehner of the state o
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ohio having received a majority of thevo votes cast is duly elected the speaker of the representatives for the 113th congress. all right, good evening, everyone. i'm larry kudlow. this is "the kudlow report." the new sizzle, the republican john boehner. hung on to his speakership despite some challenges and some tense moments on the floor of the house. and he keeps his job as speaker. but where does he go from here? has the battle over the debt ceiling and a possible government shutdown are all around the corner. but the gop has nothing but fiscal problems ahead of itself. nothing but problems. a few moments ago, new texas senator ted cruise told me that a government shutdown should be on the negotiating table that's what cruise said. plus, we go out to san francisco, the middle east backed news network al jazeera is buying al gore's current tv for a whopping 500 million bucks.
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many believe al jazeera is nothing but pro-terrorist and anti-american and should not have a foot hold in the usa. all right. first up tonight, high tension on capitol hill. house speaker john boehner barely held off a possible gop revolt over his speakership. republicans voted against boehner for speaker and five others abstained or voted present. washington editor for the national review robert costa was in the room. i think i had it wrong, nine nays, voted against him and one present. how tense, how close, what happened? >> larry, it was really tense. i was up there on the press gallery. i felt like i was a spectator at the world series watching over all this chaos and tension. if he lost 17 republican votes
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that means he would have went to a second ballot. he avoided that. he safely won the gavel. but at the same time, nine different republicans, tea party conservatives voted for different people. that's a threat to boehner that shows boehner does not have full control of his caucus. >> well, what was the revolt, why did they do that, bob? >> larry, the conservative flank is so frustrated. they just had this entire fiscal cliff deal. they had this hurricane sandy relief mess, they're frustrated with baoehner. they tried to take a stand, but the biggest take away though nine republicans voted against boehner, no, ma'minated allen w kevin mccarthy voted for boehner, there's no real challenger to boehner. >> was this a near death experience? in other words, how tough did boehner worry about this? i know his public visage was very calm, he's not worried, you're quite right the other parts of the leadership were for
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him. how tough -- is this going to have an impact on mr. boehner's policies, does he become more conservative, robert costa? what happens here? >> he's trying to become more conservative. he went in front of the caucus and pledged not to have closed door meetings with the president any longer. he won't have the kind of grand bargain discussions anymore with the president. that was a real important reason he won a lot of conservative votes today, but he only won 220 votes so it's line herding cats in 2013. what is he going to do when it comes to the debt ceiling? i'm not sure he can count on his caucus. >> hang on, we have one who cast his vote against speaker boehner. joining us now, we welcome freshman oklahoma congressman jim bridenstein. why did you vote against mr. boehner and why did you vote for mr. cantor? >> well, good to be with you. well, this was a campaign promise that goes back to i
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guess august of 2011. the last time we voted to raise the debt ceiling and we created the supercommittee. then of course that ended up in sequestration. and as a navy pilot, you know, sequestration was not something that was palatable to me. cutting $500 billion from the department of defense over the next ten years is not palatable. so i made a campaign promise in the republican primary if i were to win i'd vote against speaker boehner. here's the thing, speaker boehner is the speaker. my objective at this point is to help him be as conservative as possible because we have got big challenges with the president. >> you know, jim woodstein, you have the spending sequester coming. i don't think congress wants to cut, except for maybe a handful. then you have the debt ceiling bill which runs smack into a government shutdown potential. those are the -- those are the big issues coming up in january
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and february. what do you want boehner to do? is it right for your and caucus that boehner stay out of the negotiations with obama? that's what he pledged. he wanted to pick up conservative votes as bob costa said. is that what you want him to do? >> well, that's his decision. what i want to make sure we do is if he does go into negotiations, this is critical for any negotiation, you have to be willing to walk away from the table. and then you can start moving things in a more conservative direction. and we can start controlling spending. look, we can raise the debt ceiling, not raise the debt ceiling. our credit rating will get downgraded. what we have to do if we want to do the right thing for our country is control spending that's what i ran on. that's what i'm intending to do representing the first district of oklahoma. >> all right. how about no more tax hikes in the house? that's one of the things -- >> i'm for it. >> yes, i figured you would be -- congratulations i'm a supply-sider. but you know that obama is going to come back with another
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massive tax hike. he -- we're going to see this before the winter is out. you know that. it's going to be 6, $700 billion and going to put limits to various deductions for upper and so-called rich people. what will john boehner say? that was his original view, it didn't happen. now it's going to come back and bite him in the keister. how is he going to get around that? >> it's a good question, larry. i think speaker boehner is a deal maker at heart. he wants a grand bargain with the president but he reads the writing on the wall. he sees someone like congressman bridenstein coming in and the main threat in the house, eric cantor, and he said i won't have any kind of rate increases in 2013 because my congress won't go there. >> mr. bridenstein, is that what boehner was messaging you? okay, eric cantor, a friend, he's a pro-growth guy, but i have known john boehner for 25 years. he is also a supply-sider, he's a tax cutter, but he says no
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discussions, no negotiations one-on-one with president obama and instead, jim, here's where i'm going, he wants to go through the regular committee process in the house. he wants ryan to do the budget work. he wants dave camp to do the tax work. is that what you want? regular legislative process and work in the house? >> look, what i want to do is i want to control spending. house speaker boehner chooses to do that it's over to him. but what i have to do as a member of congress representing the first district of oklahoma is cast votes. and my objective is to get him to get us the best deal possible. he's the speaker, i'm behind him. i want is required for our country to avert disaster and that's why i ran. i want him to be successful. i applaud him for winning today. i hope he's successful in moving us in a more conservative
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direction. >> all right. thanks very much, oklahoma freshman congressman, we appreciate it. welcome to the show. and robert costa, a contributor and the head of the national review washington burroueau. we're going to switch stories to a tax travesty story. this is buried in the fiscal cliff deal. you don't know about it unless you scoured the papers today. and the worst, crooked tradition of crony capitalism, tax breaks are littered across this bill for american big business and their fat big lobbyists. as much as $80 billion in tax breaks. you, the ordinary taxpayer are going to have to pay for this nonsense, which is why i want tax reform simplification. let's bring in tim carnie, washington examiner, author of "obamanomics." i read your piece this morning before i got to the washingtll
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street's journal. i used the word $80 billion but it's supposedly $40 billion in specially targeted tax credits. why is this nonsense still going on? >> i came up with the number more like $75 billion. it's a number of existing tax credits and tax breaks that were supposed to expire at the end of the year along with the fiscal cliff. and late in the negotiations, the white house insisted on keeping many of these tax credits. so what they did is they base -- they copied and pasted a bill that passed back in august. they took that and dumped it into the fiscal cliff bill. so now we have algae subsidies, wind subsidies getting extended and even hollywood gets its own tax credit. >> i want to go there. i have a few from your stuff and other stuff. nascar subsidy, nascar, okay. very wealthy operation. they get $78 million tax credit. okay. let's see, the tuna company,
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starkist plus gets a tax credit. a rum-making company, $222 million. this is big money. i want to pause on this, hollywood gets 430 million bucks. chris dodd the former head of the banking committee is the chief lobbyist. he has his hands in everything. and it's in order to make money in depressed population areas. 430 million bucks. what is up with that? all those millionaires in hollywood, all those guys that voted for obama, now their snouts are at the trough, aren't they? >> what happened to paying the fair share. this is i think the big -- the big two big hypocrisies are obama saying we need the wealthy to pay their fair share and handing out the tax credits and also the business lobby, so many of which were saying we need tax reform. we need us to come together. everybody needs to pass this bill. so we have tax reform. but it's a business lobby that went ahead and pushed for all of
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the special carveouts. so the white house and k-street business lobby are both saying we need tax reform and on the other hand, give us ours. >> let's go to the end here. big business and big banks right here on the east coast. general electric, big subsidies for green energy. and offshore tax havens. goldman sachs gets a tax credit to build a new building in downtown new york. citi also gets a subsidy for offshore. these are the banks. i thought we stopped giving money to the banks. g.e. i guess my friend jim immelt his time on those advisory committees is paying off. i mean, tim carnie, isn't this proof pudding why we need tax reform and especially business tax reform? >> tax -- >> these are stables. these are dirty stables full of you know what, tim. >> tax -- yeah, tax complexity is the lifeblood of so many lobbyists on k-street. it has a huge dead weight cost
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on the economy and the big guys benefit while the small guys who don't understand it all they're the losers. >> see, this is not free market capitalism. tim carnie knows that. i say to you the viewer. this is not free market capitalism. this is cronyism of the worst kind and corporate welfare of the worst kind. many thanks, tim carnie. now folks today, the markets didn't continue the big rally from wednesday. coming up, the father of supply-side economics arthur laffer is going to tell us what he thinks of the fiscal cliff deal. and how in the world did al gore allow anti-american network like al jazeera to buy his cable station? it could be in 40 million homes. you know what? it may be as simple as he likes them and he agrees with them. and don't forget, folks, free market capitalism, still the best path to prosperity, not crony capitalism. we'll be back. [ male announcer ] where do you turn for legal matters?
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yesterday's massive 300-stock market rally took a pause today. maybe looking at all of those higher taxes coming in year had something to do with it. so we asked two of the sharpest and brightest advisers around what might be the key surprises for all of us in 2013.
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let's bring in rebecca patterson, from bes aher trust and executive editor michael ozanian. rebecca, what's the number one surprise for 2013? >> aside from a functional government that works in a bipartisan way, -- >> you can't be serious about that? >> no, that's a joke. >> that would be an incredible surprise. >> we'll be more realistic about the surprises. if i were looking for something this year not priced into the market that could upset the apple cart, it would be more volatile oil markets. we have seen oil markets very, very calm in a very tight range, especially brent crude which is more of the global benchmark and right now the volatility implied for oil going out the rest of this year is the lowest it's been in ages. >> so that suggests oil prices going down? >> either way. volatility is -- >> having money options, low
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volatility, which is usually -- i have to translate this. >> yep. >> usually associated with lower prices. is that fair? >> it could either way. so with equities usually think higher volatility, lower equity prices. with oil if we have a government shutdown, if we have a spending cliff problem, we could see oil fall on recession fears. that would work in this view. the other way it works is if the middle east heats up again. >> one of my personal surprises in 2013 is we're going to have government shutdown. michael, what's your surprise? >> i thought you'd say tax reform. that would shock me. >> i'm sick of it. i have the lowest of expectations. >> i think the ten-year bond will go well over 2%, i think the fed will slowly start to take the punch bowl away. if you read through the minutes that came out today -- >> really? >> yes, i do. >> all those doves, bernanke,
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yelling. all those obama appointee, you think they'll turn the monetary spigot off? >> if they don't shut it down completely it will slow down. i think you'll see the interest rates go up and corporate profits and the economy are not that strong. but look, inflation i realize only 2%. but if you look at gold, look at what's happening to the dollar, much higher inflation is clearly on the horizon. i think you're going to see a short bonds for sure. >> short bonds for sure. let's bring in my old pal, art laffer, father of supply side economics. he still has time to run art laffer investments. welcome back, buddy. >> thank you, larry. >> quick 30-second take on this fiscal cliff bill, the top tax rate was raised. what's -- how is it going to affect the economy? >> well, the bill is terrible, larry. i mean, it really is bad. the top rates being raised is terrible. i think all the junk they put in there, the -- you know, the payoffs and all that stuff are just amazing. but it's a deal, it's done. it's in place. now we have to live with the rest of the year. i think what you're going to
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find is a lot of people try to shift income out of 2013 into 2012. i think that will make the last quarter of 2012 look pretty good. but by the time we -- right now we're in 2013, i think you'll see a sharp falloff in real gdp in the u.s. i think it will be a bad year. >> income switching. the fed is going to keep pumping the money in because they'll see a lousy first quarter. >> boy, i hope he's right though. >> he should be right. >> yes, he should be. >> fed hasn't done the right thing in how many years. arthur, let me ask you this. you heard this story about corporate corruption and corporate welfare from the last segment with our pal tim carnie. up to $80 billion. really disgusting story. >> tax credits, not just tax deductions. >> what if we got the on the business tax rate down from 40% down to, i don't know, 25, 20%. what if we did that. what would the economic impact?
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>> the economy is very sensitive to the corporate income tax as are revenues. when you brought that tax rate down as you suggested, even with a expanding of the base you would find that you'll have a lot more revenues and the economy will respond very positively to lower corporate tax rates. especially globally. >> yes. he is so on it. look, if you look at the last four years we go to what art is talking about, you have got corporate cash flow looking at the fed data, larry, it's exceeded capital expenditures for four years in a row. that hasn't happened in 50 years. >> why not? >> because company have pulled back. they're concerned about not just taxes and regulation, and a concern about a falling dollar. >> concerned about obama care, mandates. >> exactly. >> and the last time this happened was 2005, 2006 when you had this gap and that was right before -- right before the recession happened. >> she's got something on the tip of her tongue. rebecca? >> i agree if we could have real
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corporate tax reform we could have growth. we have to get through the things in february which don't look very pretty. don't look likely to go smoothly if they happen at all. unfortunately. i'd say on the interest rates, i'm going to take the other side of that one for now. i think we have to remember we get two new dovish fed members coming in this year. >> they're all doves. >> talk about a wild ride for the fed. we're going to be teetering on every comment they say. >> they're hawks, they're outnumbered. >> yellen is speaking three or four times. >> yellen, and william dudley. they're all doves. they're never tighten in our lifetime. arthur laffer, let me ask you this. is he write in theory, in other words, given what the fed has done in all the recent years, shouldn't inflation and interest rates be higher than they are today? >> well, not given what the fed has done. they bought bonds and kept the
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price of bonds up, larry, which happened during the periods as we had all sorts of shift. if you read the editorial today, it is time for the fed to try to unwind these transactions. it's a very tough thing to do. they can do it. but it's a tough thing to do to bring it back to controlling the monetary base growth and money supply growth. >> would you buy or sell stocks? >> i would sell stocks. i would buy puts on the market. >> i was going to say the fed is talking about raising rates, ending qe on financial and economic conditions. their gdp forecast is way above consensus. 2.7%. so yeah, with q.e. end, yes, but are we going to get that this year? >> they said it even -- they said they wouldn't do it until the unemployment rate was 6.45% or lower. that's not here. >> buy tbx, i would not be buying equities right now. >> no equities. >> no equities.
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>> would you buy japan? the hottest stock in the world? >> no, they're debasing their currency faster than we are. they'll have problems too. >> we were buying japanese stocks and hedging the yen. >> a good idea. >> i think that's the best play out there. art laffer, thank you. michael aseinian and rebecca patterson, catch rebecca at 5:30 p.m. first up, there were some good economic numbers out today. not bad. retail sales, carmakers, even employment. i'm going to take a close look and give you my take next up. even talk about this fed confusion. [ male announcer ] count the number of buttons
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all right, big jobs report out a few hours tomorrow morning. but meanwhile some key economic releases today suggest that consumer might be a little stronger than you think. and in my opinion, the economy might be getting a bit stronger. as art laffer suggested in the fourth quarter the income is moving in the taxes. look at the important data points. here is car sales. okay. now we got down a little bit here. but if i get this right is 15.3 million. a good number. this is about 15.5, 15.6 million, but here's the real deal. throughout the year basically we have seen an upturn in car sales. i think that's very important. it shows the consumer is alive and well. and speaking of consumer, i know it's a little bit up and down. but chain store sales are doing good. in fact, turns out to be better than i thought.
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4.4%. this is december 2012 over december 2011. the prior year was about 3, 3.3%. so you have had an uneven rise in the consumer, but maybe we're finishing the year on a higher note. i'm not so sure about that. i'm not so sure about that. but we will see. all right. now you've got another thing. jobs report expectations tomorrow. this is not my forecast. i'm not in the business of forecasting nonfarm payrolls. i will only say this. the consensus, whatever that means, 160,000 and the consensus for unemployment is unchanged at 7.7%. i think i have that right. i know some people that have the jobs report up as high as 200,000. and we will see whether that works or not. now, finally, here's what may have upset the market late in the afternoon. there was a statement coming out of the fed minutes from december which i think are going to come up on the board. so i can read it to you.
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all right. quote, a few members expressed the view that ongoing asset purchases, read bonds, would be likely warranted until about the end of 2013. now, in other words you have one more year of easy money. i can just tell you and i checked with a lot of my sources, okay. when you say a few people, they're referring to the usual hawks in the reserve banks, okay? plauser, fisher, george and billick. they're hawks. but they're outnumbered as i think rebecca patterson said earlier. they're vastly outnumbered by others in the reserve bank, but mostly led by bernanke and yellen and bill dudley. they're so dovish i don't expect any change in fed policy. even though they probably should to protect the dollar. okay, enough of that. we'll get the jobs report tomorrow. i don't think the fed is moving. now, got a brand new senator from the state of texas who's expected to be a really strong
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leader in the upper chamber. he is republican senator ted cruise and he joins us next up. you want to hear what he has to say. at a dry cleaner, we replaced people with a machine.
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first up, four new republican senators were sworn in this morning as part of the new freshmen class. joining the senate is republican ted cruz. he's the first one from texas of latino descent. first of all, mr. cruz, many, many, many congratulations. >> well, thank you, larry. i'm thrilled to be here and this is a time of enormous challenge. so it's a real honor to have the chance to serve right now and hopefully to make a difference turning around the path of this country and getting serious about solving the fiscal and economic challenges with efface. >> i want to get to those fiscal and economic challenges in a moment, but there's a big news item you may be aware of it. president obama by executive order is going to allow illegal immigrants to stay in the country if they have a spouse or a parent/child relationship. it is called the hardship waiver application. it may even be stretched a little bit.
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is he on the right track with this kind of thing? >> well, i have not seen the details of the executive order, but i'll tell you this, this administration has engaged in a troubling pattern of trying to rule through the executive fiat. legislation is entrusted to the u.s. congress to pass, it is not entrusted to the president of the united states. if president obama wants to change the immigration laws he should come down to congress and he should push for immigration reform. he should not attempt to unilaterally change the law, violate the law and violate the constitution. >> because last summer as you know very well, he waived deportation of the young kids who were brought in illegally. >> right. >> but doesn't the republican party have to deal with this in a more positive, constructive way? not just language and rhetoric, sir, as you have done so successfully in texas. but changing its own national policy on immigration?
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>> there is no doubt that republicans need to, number one, hold the line and remain serious about securing the border. but number two, we need to be a party and we need to be a country that welcomes and that celebrates legal immigrants who come here seeking the american dream. that's all of us, all of our parents fled oppression and came here seeking freedom. we need to champion that. >> let me go back to where you began, the economy and fiscal policies. in almost rapid fire, senator, you're going -- this is going to be really fire by baptism. you have got to deal with the spending sequester, you're going to have to deal with a debt ceiling limitation and may have to deal with a government shutdown. what's your perspective as a freshman senator, watching this whole economic story virtually disintegrate? >> right. i think we have to get serious about fixing the problems.
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as you know, congress just passed a deal on the fiscal cliff and my opinion it was a lousy deal. i would have voted against it. it was a lousy deal because number one it raised taxes by $620 billion. that's going to kill jobs. it's going to hurt small businesses, going to hurt americans. but number two, those tax increases were not linked with spending cuts as president obama said every day on the campaign trail. they were linked with $330 billion in new additional spending. it makes the problem even worse and it was irresponsible. >> you know, if it came to it on the debt ceiling, if it came to it on the debt kreeceiling -- iw it's early, this is all hypothetical. would you go with a government shutdown? i mean, after all, if there's no money, the government has to shut down. but debt ceiling should be automatic. there ought to be some discipline. would you go for a government shutdown? i'm hearing that from my colleagues and friends in
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washington. >> i think we have to be prepared to go so far as to shut the government down. if we don't get some serious policies to stop the out of control spending, to tackle the debt and to get economic growth going again. you know, one of the reasons we got such a lousy deal on the fiscal cliff is the dynamic as you know with divided government is that whoever owns the default, whoever wins if there is no action has the advantage. if the fiscal cliff -- with the fiscal cliff if we did nothing, there would have been a massive tax increase on every american. and that gave president obama the advantage. that's why we got a lousy deal. if you fast forward to the debt ceiling i think that's the mirror image. i think the advantage is be fiscal conservatives, because if there no action the result will be a partial government shutdown. 40% of federal government spend willing stop. we have seen that before in 1995, republicans in the house shut the government down and the result was some political pain,
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but year after year a balanced budget and some of the most fiscally responsible policies we have seen from congress. we need to be willing to do that again in order to fix the problem. >> we had a couple of them during the reagan years. you know, you're right. it can be a very important bargaining tool. can be a very important fiscal measure and can slow down spending. anyway, senator ted cruz from texas, thank you, sir. all the best on the new job. >> i appreciate it. and i look forward to spending a lot of time visiting with you and your viewers. all right. let's talk some more about the immigration piece here. we bring in a president of the immigration works usa. and the executive director of the center for immigration studies. so mark, let's wrong with some family hardship waiver applications? what's wrong with what obama is doing? it seems very compassionate. >> senator cruz got it right -- >> this particular thing that that was announced this time is a relatively small measure, but
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what it is is a piece of a larger strategy that the senator actually referred to as well where this administration is usurping congress' authority and making immigration law on its own. because the president knows he's not going to get what he wants, he simply is doing it unilaterally. regardless of what you think about immigration, that kind of government by executive fiat is not what the constitution is about. >> tamara, is that what this is about? or is this addressing, you know, if the family has been broken up for years because not everybody is legal, why shouldn't it be brought together? that's kind of an american way. if you ask me. >> yeah, you have to distinguish policy from politics. policy, this is going to affect a lot of people's lives. and it's going to be very -- you know, it's going to bring families together and it sets an important precedent on saying these rules that say if you have
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been here in the past illegally you can -- you have to wait ten years to come back legally. that's an important precedent. but the senator is right about the politics. if you want immigration reform that lasts and that works and that's really going to heal the problem in this country, it has to be legislative. it has to be bipartisan. and the more the president does an end run, the harder it gets around congress. the harder and harder it gets for republicans to actually vote for the right thing. >> mark, do you want immigration reform? >> well, what does immigration reform mean? yes, but i define it differently from others. but let me just work on your -- and tamara's and other's definition of immigration reform. comprehensive immigration reform is presented as a deal where we legalize the illegal immigrants already here. we tie up the loose ends, basically, of past policy. in exchange for a promise to enforce the law in the future so we don't end up with another 12
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million illegals. the problem is, you can't support something like that if you actually don't believe that this president will enforce the law in the future. >> oh, that's silly. we have seen so much -- >> obvious on its face -- >> why can't we -- why can't we get -- why can't we have some documentation? hang on. why can't we get some documentation, work permits for those already here? i know many of them came in illegally, but there's like 11 or 12 million. you won't self-deport them. i think the reform has to start with those who are here right now. >> but it has to fix the system for the future. i want has to create ways for the workers who are going to -- we're going to need next week and next month and next year when these workers either get old or go back to mexico or go on to better jobs. we need a system that works for the future. if we clean up the mess of the past and don't -- >> why not give them worker
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permits? >> well, we should. but we're still -- those people are going to get promoted. they'll get older. the economy is going to continue to grow and if we don't fix the system now in five or ten years we'll have another big pool of unauthorized immigrants. >> this is what the debate is really about, it's not about amnesty or anything. it's about does our 316 million continent spanning nation need in order to thrive a constant inflow of low-skilled workers from abroad? that's the answer and my answer is no, we don't. >> i say we do. low-skilled and high-skilled. >> i don't agree with that, because i think you have high-skilled and low-skilled. thanks very much. now, a question a lot of people are asking tonight, why would a former vice president of the united states sell out to a middle east anti-american tv network? why? well, brent bozell about to talk
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here's the worst story today. al jazeera who many believe is proterrorist and anti-american is coming to the u.s. and we can
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thank al gore for this coe lassal misstep. they have bought gore's current tv and it can reach 40 million american households. but here's a patriotic response. as soon as the deal was announced, time warner cable pulled the plug on current and made this statement. our agreement with current has been terminated. we will no longer be carrying the service. we are removing the service as quickly as possible. okay. he's bring in our friend brent bozell. some of the cables are going to pull the plug on this thing. first thing i want to ask you, glenn beck, friend of yours and mine, offered about $300 million for this venture before al jazeera. why didn't al gore sell to glenn beck? just a question. >> well, two answers. one, because al jazeera offered $500 million and also because al gore doesn't like glenn beck. he'd be uncomfortable giving glenn beck a network.
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he was not uncomfortable giving a pro terrorist news operation a network. i can't get around that one. >> no, i think you're right. and qatar is their sponsor. so they have the deepest pockets in the world. anti-american, pro-terrorist is that fair? >> andy maresh, he went to work for al jazeera and he ended up quitting in 2008 because they were an un-american network so you have liberals denounssing them. a record a mile long of pushing a pro palestinian and a pro terrorist state as well. they have had one of their journalists arrested as being a spy for hamas. so they have got real problems over there. and why are they coming here?
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because they want to affect american public opinion. by the way, here's the key thing to understand. current tv has an audience of 42,000 people at any given time. we did a little research. that's 1/50th the audience of "honey boo-boo." there's no one watching this. they don't want current tv. you said 40 million. my understanding is it's 60 million. they had a penetration to 60 million households. >> they lost time warner and i think they lost directv. i'm not sure about that. but call it 40 million -- call it 50 million. so nobody watches the thing. but i want to ask you, is this going to create a political storm. if it's anti-american, if it's pro terrorist, bring that kind of propaganda into our cable system, brent, is this going to create a storm? >> well, i think it should. i mean, it already did once. when al jazeera tried this before they tried to come in frontally with the network and cable companies didn't want it,
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because it's anti-american. they made the right choice. they have the right to say, go tell them to go pound sand and they did. i think that time warner is the first of a number of these carriers that's going to say that to al jazeera. we don't want you. here you have a network that put out a half a billion dollars. this is like aol buying the huffington post for $300 million i. could be that colossal a disaster. meanwhile, just like ariana huffington walk aid way with $100 billion or so, al gore walks away with $100 million. the moral of the story, you and i are in the wrong business. >> no question about that. do you reckon -- let me go back to the al gore piece. i don't want to call al gore unpatriotic. he was a vice president, senator for a long time. he wouldn't sell it to glenn beck. that was before. the beck bid was a high bid and that was before al jazeera came in with the astonishing $500 million. why would al gore sell? is it a matter of money, he has
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no sense of what the propaganda is going to be like? >> current tv was a worthless entity. current tv was being dropped left and right. there were rumors that it was going to be dropped by directv. time warner was going to drop it. the word was out. when you have 42,000 listeners nationwide, you know, you could put every listener of current tv into fedex stadium and still have the stadium be half empty. i mean, there's nobody watching this thing. so it was by itself it was a useless proposition. it made sense to sell it to somebody who wanted the placements and wanted the parking garages to go into. so that's what al jazeera did. but okay, let's not call al gore unpatriotic or unamerican. let's say there's an incredible double standard when it comes to ethics and morals with al gore that he feels glenn beck is troublesome but al jazeera is quite all right. >> that's where i was going. that that was my not so subtle implication through the whole thing. you answered it. brent bozell, thank you ever so much.
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>> thank you, larry. i have another nasty story. are we headed for a government shutdown as we start the debt ceiling battle? we'll debate that big question hanging over washington and the whole country next. a government shutdown. you'll also find us in person, with dedicated support teams at over 500 branches nationwide. so when you call or visit, you can ask for a name you know. because personal service starts with a real person. [ rodger ] at scottrade, seven dollar trades are just the start. our support teams are nearby, ready to help. it's no wonder so many investors are saying... [ all ] i'm with scottrade. it's no wonder so many investors are saying... i've always had to keep my eye on her... but, i didn't always watch out for myself. with so much noise about health care... i tuned it all out. with unitedhealthcare, i get information that matters... my individual health profile. not random statistics. they even reward me for addressing my health risks. so i'm doing fine... but she's still going to give me a heart attack.
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okay. if you thought the fiscal cliff was the most boring and nasty, here we go again. the debt ceiling debate is beginning and many in washington are talking already about a government shutdown.
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here now is democratic strategist steve mcmahon and kate oebershane, author of "divider in chief." i had ted cruz on. they don't get any smarter than that. he's going to be a star. he said, yes, government shutdown should be on the table as a negotiating tool. your thought? >> i couldn't agree with him more. he said, we either fulfill our obligation to limit government spending to what we can afford or we have a partial, temporary shutdown of the government to force it through. look sequestration was put on the table through the last debt ceiling debate. do you know how much we have cut as a result of that? nothing. it's time for us to be serious and for republicans to be serious about cutting spending. >> steve, the senators in the democratic senate do not want to cut any spending or entitlements and that spending sequester which was postponed for two
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months will probably be postponed for another six months or another six years. maybe they'll cut $1.35 out of something, but that's the reality. nothing is going to get cut. >> well, larry, the truth is i don't think there are many politicians that want to cut spending or they could pass a pill to do so tomorrow and the house and the senate could pass a bill and take it to the president. in all likelihood if you got something that was passed in both houses the president would sign it. but nobody up there is serious about deficit reduction. i agree with kate. look at how well it worked out for newt gingrich. this is something that the republicans would be blamed for. if they do it, they'll be punished at the polls. >> they're blamed for everything, steve. it doesn't matter. the president constantly threatens he's going to blame republican, blame republicans. that's been very effective. republicans cower every time he says that. he's trying to balance the on the backs of the children with autism. >> that's what the president is
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trying to do? >> it's time for them to come together united in increased financial freedom for businesses and prosperity, but they can't keep cowering every time obama starts calling them names and saying they hate the middle class. they need to start articulating their vision. >> well, kate, with all due respect, standing up and saying we're not going to raise taxes one penny on millionaires we won't even have -- >> it wasn't millionaires by the way. it was $200,000 and up. you're being a demagogue when you say that. >> kate, stop for a second. wasn't that the bill that boehner couldn't get to the floor because the tea party wouldn't let it get through? yes, it was. >> small businesses, mega wealthy, all to make the republicans look like that's all they cared about, republicans need to push back and say, look, we care about small businesses. we care about the job creators in this economy. stop being scared and start talking about the need to constrain the growth of government.
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that's what conservatism is about. >> i don't necessarily agree that neither side are zealous spending cutters. but boehner is not going to agree to big tax hikes. therefore, i think cakate's log is correct. i don't want to default on the debt, no. but if you shut down the government for a period of time, after all, gingrich and clinton got a lot done, wound up with a surplus. when i worked for reagan we shut down the government several times and pressured congress in the spending cuts. i think it's a pretty good tool, steve. >> you know what, it might have been a pretty good tool 15 years ago, but here's the difference, larry. there's a $14 trillion debt right now and shutting down the government and having a default on any obligations of the u.s. government could lead to a downgrade. you saw what happened a year and a half ago when republicans played this game last time. >> all right. >> keep spending. how would wall street -- >> steve mcmahon, thank you very much. kate, you're great to come on.
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that's it for tonight's show. the government shutdown is going to be weapon and the next battle. the trick is not to default on the debt. that's where you have to draw the line. [ male announcer ] where do you turn for legal matters? at legalzoom, we've created a better place to handle your legal needs. maybe you have questions about incorporating a business you'd like to start. or questions about protecting your family with a will or living trust. and you'd like to find the right attorney to help guide you along, answer any questions and offer advice. with an "a" rating from the better business bureau legalzoom helps you get personalized and affordable legal protection. in most states, a legal plan attorney is available with every personalized document to answer any questions. get started at today. and now you're protected.
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